(March 18): Alibaba Group Holding Ltd is raising prices for its AI computing and storage products by as much as 34%, joining a host of big tech firms moving to capitalise on surging demand in the hope of recouping hefty investments.
The company is hiking prices for its T-Head AI computing chips by between 5% and 34%, it said in a statement. It’s also raising the cost of its Cloud Parallel File Storage service by 30%, it added. Alibaba shares rose as much as 4.2% in Hong Kong on Wednesday.
The new pricing, which includes Alibaba’s Zhenwu 810E chip, comes after the company launched a major structural revamp this month to focus on monetising AI. China’s e-commerce leader introduced a series of products, including an agentic AI service for businesses called Wukong, that it hopes will tap into national enthusiasm for the technology.
Tech giants from Alphabet Inc’s Google to Tencent Holdings Ltd are trying to monetise AI-related services, responding in part to growing concerns that massive AI investments aren’t generating adequate returns.
Tencent has taken initial steps to monetise the shift toward agentic AI. Last week, the company announced a more than fourfold price hike for its Hunyuan foundation models on its agent developer platform. Baidu is planning to raise the price of its AI cloud products by as much as 30% from next month, a spokesperson said on Wednesday. Google also recently announced a plan to raise prices.
AI chips are one facet of a broader campaign by Alibaba, which is due to report earnings on Thursday, to become a leader in the technology. The company has been among the most aggressive investors in and advocates for AI since DeepSeek fired up the local tech industry. Chief executive officer Eddie Wu has pledged more than US$53 billion ($67.7 billion) toward infrastructure and AI development — an outlay he’s said the company could surpass over time.
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Alibaba leads Chinese large language model makers in open-source but has so far struggled to translate that into a significant commercial lead. Just this month, Alibaba lost a star model developer, raising questions about the company’s broader approach to AI. The company this week unveiled a big corporate restructuring, creating a new Token Hub business unit to encompass its entire AI portfolio and refocus on profiting from the technology.
Alibaba is making those moves at a time Tencent is gaining momentum in AI, particularly in the field of agentic AI services that claim to carry out a series of complex tasks for users. Tencent in just the past week introduced several signature products aimed at tapping a national enthusiasm for AI agents like OpenClaw — automated services that perform real-world tasks. They underscore an initial advantage for the WeChat operator: it’s grouped China’s entire universe of apps onto a single platform with 1.4 billion users. The company is now working to integrate its own AI agent into WeChat, automating tasks like hailing a ride or booking restaurants, according to a person familiar with the matter.
Just hours before Alibaba’s announcement, Nvidia Corp chief executive officer Jensen Huang said the company is firing up manufacturing of H200 AI accelerators for customers in China, a sign of strong demand for AI computing power in the Asian country.
See also: Alibaba planning major revamp to heighten focus on AI profits
Chinese shares related to OpenClaw jumped Wednesday, buoyed by bullish comments from Huang about the potential of artificial intelligence agents.
Nevertheless, China’s leading AI firms are expected to favour domestically produced AI chips over those produced by Nvidia, Bloomberg Intelligence analysts said.
“Inconsistent US export policies have reinforced incentives to ‘buy local’ to reduce supply-chain risk, a move that also supports China’s push for semiconductor self-sufficiency,” Jasmine Lyu and Robert Lea wrote in a note. “Any H200 sales opportunity window risks being short-lived.”
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